American X wishes to borrow U S dollars at a fixed rate of interest Corporation Y wishes to borrow Japanese Yen at a fixed rate of interest The amounts required by the two companies are the same at the current exchange rates The following interest rates are listed adjusted for taxes Yen Dollars Company X 6 0 9 10 Company Y 5 5 11 20 Create a swap that will net a bank 40 basis points per annum Make sure the swap is equally attractive to both companies and foreign exchange risk is assumed by the bank

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American X wishes to borrow U S  dollars at a fixed rate of interest  Corporation Y wishes to borrow Japanese Yen at a fixed rate of interest  The amounts required by the two companies are the same at the current exchange rates  The following interest rates are listed adjusted for taxes  Yen Dollars Company X 6 0  9 10   Company Y 5 5  11 20   Create a swap that will net a bank 40 basis points per annum  Make sure the swap is equally attractive to both companies and foreign exchange risk is assumed by the bank

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American X wishes to borrow U.S. dollars at a fixed rate of interest. Corporation Y wishes to borrow Japanese Yen at a fixed rate of

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	Yen	Dollars
Company X	6.0%	9.10 %
Company Y	5.5%	11.20 %